Movie Theater Owners Sue NJ Gov. Over COVID-19 Shutdown

By Bill Wichert
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Law360 (July 7, 2020, 4:29 PM EDT) -- The AMC movie theater chain, other theater owners and their trade groups have hit New Jersey Gov. Phil Murphy and the state health commissioner with a federal lawsuit alleging they are unconstitutionally keeping theater doors shuttered amid the COVID-19 pandemic while permitting similar venues like churches to reopen.

The owners and trade associations provided representatives of Murphy and Commissioner Judith Persichilli with "detailed safety protocols" for reopening theaters in the state, but instead of addressing them "in any meaningful way," the executives "have chosen to continue to discriminate against movie theatres," according to the complaint filed on Monday.

"Plaintiffs understand defendants' goal of protecting the health and safety of New Jersey residents and mitigating the risk of the spread of COVID-19," the complaint said. "But having concluded that it is in the interests and welfare of New Jersey residents to permit the reopening of businesses, defendants must apply the law to similar entities and activities in a similar fashion."

In addition to AMC, the plaintiffs include the National Association of Theatre Owners, the National Association of Theatre Owners of New Jersey, Cinemark USA Inc., Regal Cinemas Inc., BJK Entertainment Inc., Bow Tie Cinemas LLC and Community Theaters LLC.

As cases of the novel coronavirus were rising in the state, Murphy issued an executive order on March 16 that in part directed movie theaters and other businesses to close to the public as of 8 p.m. that day.

Movie theaters have not reopened since then, causing substantial financial losses to the owners and leading them to lay off, furlough or reduce the hours of staff members, the complaint said.

On May 18, the governor unveiled a multi-stage approach to reopening businesses during the pandemic, with movie theaters placed in stage three, the complaint said.

A few days after stage two began on June 15, state officials announced that the indoor portions of shopping malls could reopen on June 29, but said movie theaters and certain other businesses inside malls must remain closed, the complaint said.

Murphy and Persichilli "provided no timeline for the commencement of Stage 3, or for the reopening of movie theatres," according to the complaint.

After places of worship were initially allowed to reopen on June 13, Murphy issued an executive order on June 22 that permitted "religious indoor gatherings of up to 100 people (or 25% capacity, whichever is lower)," the complaint said.

The governor issued another executive order on June 26 that allowed certain businesses to reopen to the public on July 2, but said "performance-based locations such as movie theaters, performing arts centers, and other concert venues" must remain closed.

Those entities cannot reopen in part, "because there are an especially high number of available outdoor and virtual options for members to the public to view and listen to movies and other performances, whether live or otherwise, that reduce the risk of indoor person-to-person contact and COVID-19 transmission," according to the executive order.

In their complaint, the theater owners and trade groups said that justification is "irrational and unreasonable, as the types of activities occurring in places of assembly that have been allowed to reopen also may be done outdoors or virtually."

"For example, prayer can be done outdoors or virtually, while places of worship have been allowed to reopen; reading can be done outdoors or virtually, while libraries have been allowed to reopen; shopping can be done outdoors or virtually, while shopping malls have been allowed to reopen," the complaint said.

The owners and trade associations took aim in particular at how movie theaters have been treated differently than places of worship, saying there is "no rational basis" for such disparate treatment.

The plaintiffs cited the U.S. Supreme Court's May 29 opinion in South Bay United Pentecostal Church v. Newsom , which "held that comparable treatment of places of worship and movie theatres in connection with reopening was consistent with the Free Exercise Clause of the First Amendment," the complaint said.

Public health experts also have "rated places of worship as more risky than movie theatres, highlighting the increased risks posed by singing in places of worship," the complaint said.

"Unlike attendees at places of worship, movie theatre guests generally do not engage with those outside their immediate groups to have conversations, hold or shake hands, hug, sing, provide verbal responses, do responsive readings, or engage in other forms of contact regularly engaged in at places of worship," according to the complaint.

The governor's office and the state attorney general's office declined to comment on Tuesday. Counsel for the plaintiffs declined to comment on Tuesday.

The plaintiffs are represented by Geoffrey S. Brounell, Robert Corn-Revere, Janet Grumer, Martin L. Fineman and John D. Freed of Davis Wright Tremaine LLP.

Counsel information for the defendants was not immediately available.

The case is National Association of Theatre Owners et al. v. Philip D. Murphy et al., case number 3:20-cv-08298, in the U.S. District Court for the District of New Jersey.

--Editing by Nicole Bleier.

For a reprint of this article, please contact reprints@law360.com.

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